Greek merchandise exports are expanding in world markets, underscoring how Greek products have become globally competitive in recent years. A new report by Alpha Bank shows that exports of goods have surpassed exports of services, long a mainstay of the Greek economy, for the first time in a quarter of a century.

“Over the past three years, Greek competitiveness has been at historically high levels,” notes the report. “Despite the strong recovery in tourism, exports of goods gained ground over exports of services in 2021-2022, with their share of the total exceeding 50% for the first time since 1998.”

During the past two decades, Greece’s economy evolved into an increasingly services-oriented economy with two sectors in particular, tourism and shipping, accounting for roughly a third of GDP and comprising a major portion of external trade.

By contrast, Greek farmers and producers of goods have steadily lost ground to cheaper countries in the region and in Asia. Much of Greece’s industrial base was hollowed out during the 1990s, as manufacturers moved to less expensive foreign destinations. But that has begun to change as successive Greek governments undertook reforms, the economy became more competitive, and Greek businesses increasingly looked to foreign markets for growth.

The last two years have been decisive, according to the report. The gross value added of Greece’s internationally tradeable goods has risen over the last decade, while export performance has soared despite a deterioration in Greece’s real effective exchange rate in 2021 and 2022, pointing to a fundamental “improvement in the competitiveness of the Greek economy.”